Ansett 'worse off now': unions

Old Feb 6, 02, 10:09 pm
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Ansett 'worse off now': unions

Ansett 'worse off now': unions
From AAP

ANSETT'S operations were worse off now compared to when administrators took over last September, unions have said.

ACTU counsel Michael Beach told the Federal Court today Ansett had operated at a loss of about $4 million in the three months after September 29 when administrators returned the airline to the air.
"Now in February alone (the estimate is) $24 million. That's quite a different position," Mr Beach told the court.

He said the revamped airline's estimated staff numbers had plummeted while operational losses during the interim period had escalated to an estimated $6 million a week.

Under such conditions there were fears employees would miss out, he said.

Ansett administrators are calling on the Federal Court to sanction their decision to trade at a loss while would-be owners Tesna finalised sale documents.

The Australian Securities and Investments Commission (ASIC) opposed the application today, saying it was not in the court's jurisdiction to comment on commercial decisions.

Ansett had operated at a loss since administrators took over operations on September 29, but had only requested court support now that there was a threat the sale may fall through, ASIC barrister Michael Sifris said.

Creditors approved the administrators' decision to trade at a loss when they voted on the Tesna sale at a meeting last week.

But the situation had changed again since then, unions warned the court.

Yesterday, it was revealed the new airline had reduced estimated staff numbers by 25 per cent, from 4,000 to 3,000.

"If we drop down to 2,500 employees and there's a (trading) loss of more than $24 million over February, there may not be enough money to pay employees' entitlements," Mr Beach said.

He called on the Federal Court to closely monitor the administrator's decision, and sanction continued operations until February 15, before reassessing the situation.

The hearing continues this afternoon.

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